Property Settlement Lawyers
A good property settlement lawyer will advise you on:
- how much property you are legally entitled to in a divorce or separation;
- how to get what you are entitled to taking into account the property pool and the likely legal costs involved; and
- how to best finalise your property settlement agreement to minimise potential tax liabilities.
Property Settlement Services
Our property settlement lawyer services include but are not limited to:
- investigating and identifying the total property pool, this might consist of performing state and government searches, examining bank statements and spendings and working with accountants, financial advisors, property evaluators, real estate agents and other consultants to ascertain the total property pool;
- legally advising you on your property settlement entitlements;
- negotiating with your former partner or their lawyers to reach a property settlement agreement;
- suggesting alternative ways to pursue your property settlement entitlements, this might include mediation, arbitration and the last resort – litigation.
What is a property settlement?
A property settlement in family law is the legal division of assets between two parties, often described in percentages, e.g. 50/50 or 60/40.
A property settlement is formalised by either a:
- Consent Order; or
- Binding Financial Agreement.
Property settlement divorce in Australia who gets what?
There are no 50/50 requirements for a divorce settlement. To determine a property settlement in Australia, we apply what is commonly known as the “four-step” process:
- Step 1 – identify and value the net property (include assets and liabilities);
- Step 2 – determine the contributions of the parties;
- Step 3 – section 75(2) factors (parties needs); and finally
- Step 4 – considering all of the above, determine whether the proposed settlement is fair.
Step one – identify and value the net property
The first step is to determine the property pool. A property pool can include cars, houses, shares, superannuation and valuable property.
Then look at your liabilities, do you have credit cards, personal loans, mortgages?
Also, consider if one party has wasted or spent money on such things as gambling or the purchase of gifts for third parties this money may be added back into the pool of assets.
It is good to look at tax implications at this stage, including CGT or GST.
Step two – identify the contributions
Contributions can be made initially when the parties first get together, during the relationship or post-separation.
They aren’t just financial; a contribution can include non-financial contributions like work performed on the house or even being an artist’s muse. Other contributions include the care of the family including homemaker, or parent will also be taken into account and weighed appropriately.
Step three – section 75(2) factors
The court will look at the parties needs after the relationship finishes. The court will particularly look at how the parties will support themselves and whether the marriage or relationship has affected them getting work. Some of those factors are listed below:
(a) Age and health;
(b) Income, property and financial resources and physical and mental capacity for
(c) Whether the party has care and control of children;
(d) Financial commitments necessary for support;
(e) Responsibility to support any other person;
(f) Eligibility for pension or superannuation;
(g) The standard of living reasonably in the circumstances;
(h) How maintenance might increase earning capacity;
(i) Effect of order on creditor’s ability to recover;
(j) Contribution to income and property;
(k) Effect of duration of marriage on earning capacity;
(l) Protecting a party who wishes to continue the role of parent;
(m) The financial circumstances relating to cohabitation with another person;
(n) The effect of the terms of an order proposed under s 79;
(na) Child support commitments or receipt;
(o) Any fact that justice dictates be taken into account;
(p) and (q) The terms of a financial agreement.
Step four – just and equitable outcome
Most parties were having a sense of fairness, and the majority of property settlements occur either without a formal agreement or with readily negotiated consent orders. It is not uncommon, however, for a party to be excessively generous out of guilt or a party feeling wronged to be unreasonable. It’s for both parties benefit that they feel the settlement is fair; unfairness will likely result in resentment which can hurt relationships with children or leave one party feeling bitterness over the result which can make it hard for either party to move on.
Property settlement after divorce time limit
Time limits do apply to property settlements. For de facto relationships, proceedings must be instituted within two years of separation. If the parties are married, they must serve any application within 12 months from the time a divorce order becomes absolute. There are exceptions to the time limits including seeking leave from a court or having both parties to a marriage consent. Property includes assets and liabilities that are owned individually, by another person or by a family trust or family company. Generally, the courts view as property anything that is a financial resource. Smaller items can make up the property pool if both parties agree on the value.
Property Settlement Process
It’s important to try and keep the property settlement out of court. Litigation is expensive and can be harmful to the relationships between the parties. However, it is best to comply with pre-action procedures even if you have no intention of taking the matter to court. They are procedures which set out what parties should do before making the case to court, it is considered best practice to follow them as it controls costs and if possible resolve disputes quickly. These are the steps to be taken:
- Step 1 – Invite the other parties to participate in dispute resolution. This may include engaging in negotiation, conciliation, arbitration and counselling. It is here where most matters are resolved.
- Step 2 – If the mater does not resolve or one party refuses to participate in dispute resolution. Then you can give the other person written a notice of intention to start a case in court. This written notice should set out the issues in dispute, an offer and a nominated time to reply.
- Step 3 – The other party must reply to the notice of claim within the nominated time. If there is no reply the obligation to follow pre-action procedures is now completed. The reply should include a genuine counteroffer to resolve the dispute.
- Step 4 – If an agreement cannot be reached after reasonable attempts to resolve it, then either party can commence proceeding by filing an Initiating Application in either the Family Court or in the Federal Circuit Court.
Property settlement solutions
If you’ve agreed on a property split, you can document that agreement via consent order or a binding financial agreement. An excellent property settlement lawyer will advise you on what is best in your situation.
Property Settlement Agreement
Financial Agreements can be made under the Family Law Act and deal with all aspects of the division of the parties’ property including superannuation interests. You can make a Financial Agreement before you are married, while you are married or after you get divorced. Some formal requirements need to be met for it to be a valid and binding Financial Agreement. Learn more about financial agreements.
What’s a Consent Order?
A Consent Order is no different to an order made by a judge but is done with the consent of the court and all parties involved. The parties may not need to attend court if they file an Application for Consent Orders. For an Application for Consent Orders to be approved, the court must be satisfied that the orders are just and equitable. In some cases, it may then be necessary to file the further information setting out why parties have agreed to the terms as they appear. Learn more about consent orders.
Should we have binding financial agreement or apply for a consent order?
Whether you should have a Financial Agreement or a Consent Order depends on your situation. There are many reasons you might choose a Financial Agreement. You might be out of time, the agreement might not be equitable, or you might want the deal to be confidential between the parties.
What is the difference between binding financial agreements and consent orders?
Both Consent Orders and Financial Agreements that meet the requirements of the Family Law Act are binding on the parties. However, it is much easier to enforce Consent Orders than it is a Financial Agreement. Breaching court orders can have serious consequences.
It is best to discuss with your lawyer what is right for you.
It’s important to note that the application for Consent Orders requires parties to swear they “have no interest in a property, superannuation, or a financial resource which is not described in the application. Financial agreements also require disclosure and a financial agreement may be set aside if there was non-disclosure of a material matter. It is important to always make full financial disclosure in a family law property matter.
Divorce property settlement guidelines
If the parties do not agree on the value, then an independent valuation can be sought. However, this is usually reserved for items of the significant amount. The court is generally not interested in entertaining about things of little or no value. It will still form part of a property pool regardless of whether the property is owned in joint names or owned by one party only. It may also form part of the property pool on certain occasions if it is owned by trusts, companies, partnerships or other corporate entities.
If you have only been together for a short time but still meet the requirements of marriage or de facto relationship status. It might be best to look at the property on an asset by asset basis rather than a pool.
Often families will have a family trust or hold assets in a company name. This does not mean they aren’t considered part of the property pool. Certain rules exist as to when property held by a trust or company may be transferred to the other party. These rules are complex and it’s best to seek legal advice early.
If the house is owned jointly you will need both parties to consent to the sale, the only way a party can be forced to sell is through a court order. If a house is solely owned you should be careful the other party doesn’t sell it secretly. You may need to put a caveat on the property.
Superannuation is treated as property it can be divided between the parties after the breakdown of a marriage or the breakdown of a de facto relationship. Superannuation interests can be divided via:
- court order; or
- a superannuation agreement (either stand-alone or part of a financial agreement).If you have already reached an agreement before seeing a lawyer, the lawyer will have a role to property formalise your agreement, or help you conduct transfers of superannuation or property.
In these cases, the best way to formalise the agreement is usually by way of consent orders filed in the closest registry of the Family Court or Local Court but the parties can also enter into a financial agreement if they choose to.